4746: Business Income Worksheet (2025)
Michigan · Michigan Treasury · Used for tax years 2025
Michigan Form 4746, Business Income Worksheet, calculates business income for Michigan Business Tax purposes using federal income, deductions, and Michigan depreciation adjustments. It has separate sections for individuals and fiduciaries, C corporations, and partnerships and S c
Who files this form
Form 4746 calculates business income. The form directs taxpayers to complete the appropriate part and attach the worksheet to their return:
- Part 1: Individuals and fiduciaries.
- Part 2: C corporations, including persons filing federal returns as a C corporation.
- Part 3: Partnerships and S corporations, including persons filing federal returns as a partnership or S corporation.
Unitary Business Groups (UBGs) must complete and attach a separate worksheet for each member.
What you'll need
Use the federal forms and information that apply to your organization:
- Individuals and fiduciaries: U.S. Form 1040 Schedules C or C-EZ, D, and E, plus Form 4797 for business gains or losses not included in Schedule D.
- C corporations: U.S. Form 1120 for federal taxable income.
- Partnerships and S corporations: Schedule K of U.S. Form 1065 or 1120S for income, losses, and deductions.
- If applicable: Form 8903 for a domestic production activities deduction, and depreciation amounts needed to calculate bonus depreciation and asset-sale adjustments.
Have your FEIN or TR number available, along with the UBG member's FEIN or TR number if applicable. Include explanatory attachments for entries on lines 6, 13, 18j, and 20d, and for uncommon business-income situations not covered by a specific line.
How to file
Complete the part that matches your organization type and attach Form 4746 to your return. A UBG must attach a worksheet for each member.
Carry the final business income amount from line 10, 17, or 25 to Form 4567, line 28. For a UBG member, carry it to Form 4580, Part 2A, line 30.
The supplied form text does not provide a mailing address or e-file instructions.
Common mistakes
- Including personal gains or losses: For the entries from U.S. Forms 1040D and 4797, report only gains or losses from assets used in a business activity.
- Dropping a negative sign: Enter negative depreciation adjustments and negative adjustment totals as negative amounts.
- Missing explanatory attachments: Attach explanations for the lines that request them and for uncommon business-income situations reported on the most appropriate line.
- Claiming a state-only Section 179 election: You may not elect Section 179 expensing for an asset for Michigan Business Tax purposes unless you elected it federally for that asset.
- Overlooking separate UBG worksheets: Complete and attach one worksheet for each member.
Questions people ask
Which part should an S corporation complete?
Complete Part 3, which covers partnerships and S corporations and continues onto page 2.
Does a UBG need a worksheet for each member?
Yes. A UBG must complete and attach a separate worksheet for each member.
What if my business income does not fit a specific line?
Report the amount on the most appropriate line and include an attachment explaining it. Treasury may adjust the worksheet result to account for uncommon situations.
When is a net bonus depreciation adjustment required?
For Michigan Business Tax purposes, persons who claimed federal special depreciation under IRC Section 168(k) on property first placed in service in 2008 or later must calculate the adjustment. It equals federal depreciation claimed for the tax year minus the depreciation that would have been claimed without the bonus depreciation allowance.